Video Transcript: Network-Based Organizations

I love bureaucracy when it's performed well, but this model of organization is  absolutely being challenged for a whole variety of reasons, but two of which, in  particular, number one, it relies upon the wisdom of the few, typically male,  typically gray haired individuals at the top. And secondly, it's not a model of  organization which was ever designed to change or to promote change. The  focus is all around efficient execution. What's coming in its place, we think, is  this idea of a network based organization, not a hierarchy, but a network in  which people are not simply cogs in the machine, but rather bring their talent,  bring their passion, bring their creativity and their personality to the workplace.  It's not a hierarchy, it's flat. It's not about creating structures through which we  align. Work about developing relationships. It's not about imposing rules which  dictate what people do and how they do it, but rather building a community  through values, through shared culture. When you see something like this on  the screen and you're presenting to an MBA class like we have at Oxford,  fantastic MBAs, almost 350 of them, all of whom are millennials. Can you  imagine which one they want to work in the stable hierarchy that offers a  relatively predictable career if you can perform, or the flat, loose, flexible, agile,  empowering, galvanizing, energizing community that you see in what  academics, whose complete lack of imagination, called the post bureaucratic  organization, but we'll call the network organization. Can you imagine which one they want to work for? Well, you've guessed it. It's the network. If only it were as  easy as making a transition from our 20th century industrial thinking to what's  often called the 21st century Information Age thinking, If only it was so simple.  But the reality is, as much as we value innovation today, as much as we want  that, as much as we need that, that alone is not enough in order to ensure  success, we still need aspects of superior execution, cost management,  efficiency, control, managing, risk, all of the aspects that the bureaucracy  actually does quite well. Well when it is well designed and managed, we still  need that as well. So in the future work for us isn't simply transitioning or  transforming from one the 20th century model to the 21st century model for all of us, actually, the challenge is much more nuanced and complex. It's about finding not one or the other, but actually developing hybrid best of both, being, as my  colleague, Professor Ben Tresca described earlier, ambidextrous, capable of, on the one hand, exploiting performance today, on the other hand, building  capability for competitiveness tomorrow. So actually, these are not binary, one or the other. They sit on a continuum. And increasingly, our requirement as  businesses across the world and in all sectors is to find a point on a continuum  that works for us, a point on that continuum that works for us, the hybrid best of  both that can combine the capabilities of the bureaucracy and combine the  benefits of the network, can be simultaneously efficient and simultaneously  innovative. And the challenge is that, of course, those things are often trade offs. It's really hard to be great at efficiency whilst also being highly flexible, that is the

challenge.